Venezuela arrests two Chevron employees amid oil industry purge

CARACAS/HOUSTON, April 17 (Reuters) - Venezuela arrested two Chevron Corp employees, the U.S. oil major said on Tuesday, in what appeared to be the first arrests of a foreign oil company’s direct employees during a purge of alleged graft in the OPEC nation.

Venezuelan intelligence agents arrested the two Venezuelan executives at the Petropiar joint venture in the coastal city of Puerto La Cruz on Monday for alleged wrongdoing, two sources in the oil industry told Reuters. One of the detainees, Carlos Luis Algarra, is a refining expert whom Chevron had drafted in from its Argentina operations, a third source said.

Chevron confirmed the detentions in an emailed statement to Reuters on Tuesday.

“Chevron Global Technology Services Company is aware that two of its Venezuelan-based employees have been arrested by local authorities on April 16th, 2018. We have contacted the local authorities to understand the basis of the detention and to ensure the safety and wellbeing of these employees. Our legal team is evaluating the situation and working towards the timely release of these employees,” the company said.

Chevron declined to provide further details. Venezuela’s Information Ministry did not respond to a request for comment.

Leftist President Nicolas Maduro has since last year overseen a major crackdown on alleged graft in Venezuela, with dozens of oil executives, including the former oil minister and president of state oil company PDVSA, now behind bars.

The purge comes years after industry analysts and opposition politicians began criticizing PDVSA management for widespread graft. A report by the opposition-led Congress in 2016 said at least $11 billion went “missing” at PDVSA between 2004 and 2014.

For years, the government decried such accusations as “smear campaigns” against socialism and in favor of a U.S.-backed coup.

But Maduro, who is running for re-election next month, later changed his tone. He now blames “thieves” and “traitors” for an economic crisis so severe that disease and malnutrition are spreading unchecked by a broken public health system.

Vowing a cleanup, Maduro replaced many of the jailed executives with soldiers.

But the major general now in charge of the oil industry has quickly alienated PDVSA’s embattled upper echelon and its rank-and-file, spurring thousands of resignations that further threaten to hurt the ailing industry. (Reporting by Alexandra Ulmer and Marianna Parraga; editing by Jonathan Oatis)